There's no particular reason why you couldn't split a train and it's common enough practice in other European countries. Platform 3 should be long enough to support it as well.
So, what you could have is a Limerick-Limerick Junction train that goes to Limerick Junction, with half of it going back to Limerick and the other half going to Waterford.
The Limerick train would need to leave first (giving chance for any Cork-Dublin or Dublin-Cork trains to leave the main line), with the Waterford train leaving later.
There are a few disadvantages
- I believe the 22000s are the only suitable rolling stock, which would mean 6 cars leaving Limerick, with 3 going back and 3 onto Waterford. This seems over-capacity
- It complicates driver rostering
- It can be confusing for passengers, especially in a country where we are not used to this set up
- There would necessarily be a 10 minute or so delay between the train from Limerick and the one to Waterford departing. This isn't much better than the 09:05 service achieves today.
- Any late running of a service on the mainline would necessarily delay the train to Waterford. It's not just a matter of missed connections, but also because it couldn't cross the tracks
None of those would preclude a service. They just need to be taken into account when considering its viability.